Preparing for international contract negotiation: risks and positions

Situations calling for preparation of international contract negotiation

• An exporter receives a foreign buyer’s draft contract and needs to settle its priorities before the first meeting.
• A distributor discusses a distribution agreement clause by clause, without a hierarchy of issues.
• A service provider faces a foreign client’s general terms and conditions and seeks to measure their operational effects.
• An importer examines several successive versions of a sales contract and loses the overall view of the risks.
• A company prepares to discuss a licence with a foreign partner and seeks to set its non-negotiable points.

Process

1. Onboarding. The client first acquires the intake form CV-21. ASKonsult then opens the secure exchange space, the sole channel for transmitting documents.
2. Synchronous scoping. A first 60-minute videoconference session covers the transaction and the balance of power. It also specifies the signing timetable and the priority clauses.
3. Asynchronous collection. The client completes the form and provides the draft contract, the general terms and conditions and the exchanges. Written questions then flow in both directions.
4. Analysis and correction. The in-house engineering team carries out a clause-by-clause reading, using the firm’s tools, followed by a risk rating. It then settles the negotiating positions, which a second 60-minute videoconference session reviews.
5. Synchronous delivery. A third 90-minute session finally closes the process. ASKonsult delivers the validated deliverable there and prepares the negotiation meetings with the client.

Deliverable

The deliverable equips international contract negotiation. It first includes a matrix of operational and commercial risks, drawn up clause by clause. A negotiation grid accompanies it; it distinguishes the opening position, the fallback position and the non-negotiable points. The deliverable then lists the questions to be put to the counterparty. Finally, a summary note describes the transaction: Incoterm, payment terms, guarantees, governing law and disputes. ASKonsult delivers the whole set, validated, at the debrief session.

Prerequisites

The process first requires the completed form CV-21. The client also provides the draft contract or, failing that, the counterparty’s general terms and conditions. Relevant negotiation exchanges finally complete the file. The indicative timeframes of the preparation run from receipt of a complete file.

Frequently asked questions

How is the quote established?

A prior qualification exchange precedes the quote. It covers, in particular, the nature of the contract: sale, distribution, services or licence. The number of versions to be examined is also taken into account. The special terms then set the scope, timetable, number of sessions, expected documents and deliverable. The order then follows from the accepted quote.

Does the package include drafting the contract?

No. The package prepares international contract negotiation, but it includes neither drafting nor amendment of the contract. Final drafting falls within the remit of an authorised professional chosen by the client. Likewise, assessment of the validity of the clauses and their interpretation fall outside the scope. When the question requires it, ASKonsult therefore refers the client to an authorised professional.

How are the sessions organised?

The package includes three synchronous videoconference sessions, 3 h 30 min in total. The scoping lasts 60 minutes, the review of positions 60 minutes and the debrief 90 minutes. Between these sessions, the collection of documents and written questions take place asynchronously. ASKonsult also schedules the sessions in advance, in set time slots, taking the signing timetable into account.

Does the package commit to the outcome of the negotiation?

No. The service is subject to an obligation of means. It informs the client’s positions, but it guarantees neither the agreement nor its terms. The client remains the sole decision-maker and conducts the negotiation meetings itself. It is also responsible for the accuracy and completeness of the information provided. Any representation before the counterparty remains outside the package.

Do the documents provided remain confidential?

ASKonsult treats the draft contract, the general terms and conditions and the exchanges provided as confidential. These documents circulate only through the secure exchange space. They serve solely the purposes of the package, and this obligation survives the end of the relationship. Reciprocally, the client undertakes the same discretion regarding non-public tools and deliverables.

What follow-up can be considered?

Upstream of an export project, the Export market selection package (K-09) informs the choice of target market. The Inventory and protection of intangible assets package (K-17) is another possible follow-up. In addition, the Steering subscription (A-02) provides regular support to exporting companies. It then handles day-to-day questions as transactions proceed.

Out of scope

Preparing for international contract negotiation includes neither drafting nor amendment of the contract. Nor does the package assess the validity or interpretation of the clauses. Representation and translation also fall outside the service. Finally, final drafting falls within the remit of an authorised professional chosen by the client, to whom ASKonsult refers where necessary.